Good morning, and welcome to Rockwell Collins Fourth Quarter Fiscal Year 2011 Earnings Conference Call. Today's call is being recorded. For opening remarks and management introductions, I would like to turn the call over to Rockwell Collins Vice President of Investor Relations, Steve Buesing. Please go ahead, sir.

Steve Buesing

Thank you, Lindsay, and hello, everyone. With me on the line this morning are Rockwell Collins Chairman, President and Chief Executive Officer, Clay Jones; and Senior Vice President and Chief Financial Officer, Patrick Allen.

Today's call is being webcast, and you can view the slides we will be presenting today at our website at www.rockwellcollins.com, under the Investor Relations tab. Please note today's presentation and webcast will include certain projections and statements that are forward-looking as defined in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected as a result of certain risks and uncertainties, including, but not limited to, those detailed on Slide 2 of this webcast presentation and from time to time, in the company's Securities and Exchange Commission filings. These forward-looking statements are made as of the date hereof and the company assumes no obligation to update any forward-looking statements.

With that, I'll turn the call over to Clay.

Clayton Jones

Thanks, Steve, and good morning, everybody. As the last quarter of our fiscal year 2011 ends, I'm happy to report that at least some order has been restored to the universe. After experiencing the unusual events that influenced our third quarter results, fourth quarter performance was in line with our expectations, and hopefully, restored confidence in our ability to achieve the targets that we set for this company.

Considering the current market conditions that we're operating under, I'm pleased with our performance and the results that we posted this quarter.

Now, as I reflect back on fiscal year 2011, it certainly was a dynamic period marked with unexpected developments. Early on, we saw delays in the Boeing 787 and the KC-46 program impact each of our businesses. Then concerns about the U.S. budget deficit began to put pressure on the defense budget, causing delays in government spending, as we operated under a continuing resolution for more than 6 months of the year.

Finally, budget pressures drove the Department of Defense to cancel 3 of our programs for convenience in the third quarter. Now through all of this, I believe we did a pretty good job navigating these storms, delivering sales and operating cash flow within the original -- the guidance targets that we set at the beginning of the year. Earnings per share above the top end of that initial range.

In fact, several times over the past decade, we've demonstrated the capability to take steps necessary to manage through market-down cycles and create a stronger, better positioned company for the ensuing recovery. Restructuring actions we took this quarter are indicative of steps that we take to align our infrastructure to market conditions.

So as I look forward to fiscal year 2011, our balanced business model is again expected to be a valuable asset. Growth in Government Systems will continue to be challenged for the foreseeable future due to general market conditions. And while there is uncertainty surrounding the actions of Congress and the DOD and what they might do, we will focus on the things that are more controllable, such as profitability and cash flow performance.

Over the next few years, sales may be increasingly difficult to predict in any given quarter in Government Systems. For example, FY '12, sales for Government Systems are expected to be down, low double-digits in the first half of the year, followed by mid-single-digit growth in the second half. However, even with that sales volatility, we believe we can manage the business to sustain industry-leading operating margins and generate the strong cash flows typical of our government business.

Fortunately, the other half of our company is positioned very well just as all leading indicators point to solid commercial market growth. In air transport, both Airbus and Boeing continue to build their backlogs and have announced rate increases across almost all of their product line. Even with the recent delays in the economic recovery, we've yet to see any meaningful slowdown in passenger traffic.

In the business jet market, utilization is up, and inventories have used aircraft for sale and used aircraft pricing have stabilized. This market continues to be strong at the high-end, but we now have a growing presence on the Bombardier Global 5000 and 6000 aircraft, the future positions just announced this month on their 7000 and 8000 models. We're also seeing signs of improvement with some of the midsized jets beginning to increase rates, like the Challenger 300 at Bombardier. And demand for light jets is at least supporting the current production rates.

At the National Business Aircraft Association Office earlier this month, we announced an important new development for our Pro Line Fusion product line. With the certification of the core architecture completed, we're taking the next step to make the robust features designed into the system available for light jets and turboprop aircraft with our Pro Line Fusion embedded display system. This will allow our product line to scale from intercontinental business jets, that's already highly successful, all the way down to single-engine aircraft. This product extension will be available as an upgrade option for the highly successful Hawker Beechcraft King Air.